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Blackstone and First Reserve unveil $2bn alliance with Petroplus

Blackstone and First Reserve on Wednesday declared a $2bn (â‚¬1.3bn) partnership with Europe's largest independent oil refiner, Petroplus, to make new investments in US oil refineries.

The three firms will each contribute $666m to the partnership, named PBF Partners, borrowing the first initials of each firms' name. The partnership will be run by Thomas O'Malley, a well-travelled oil executive who is stepping down as Petroplus' chief executive but will remain chairman. Potential opportunities include US refineries owned by Citgo Petroleum, the Venezuelan-owned oil company, and refineries being sold by Valero Energy.

For Blackstone and First Reserve, the deal underscores how private equity firms are being forced to put their money to work in less conventional ways. Unable to raise financing for large leveraged buyouts, they are moving into minority stakes, joint ventures and smaller investments in public companies.